![\"Canberra](\"https:\/\/www.solarquotes.com.au\/blog\/wp-content\/uploads\/2021\/08\/zero-percent.jpg\")
<\/p>\r\n<\/p>\r\n
The ACT’s Sustainable Household Scheme will soon be in full operation.\u00a0 It makes zero-interest, zero-fee loans available to households for rooftop solar, batteries, electric car chargers and energy efficiency measures such as replacing gas appliances.\u00a0 In the future, it will be available for new and used electric vehicles. <\/p>\r\n
The minimum loan amount is $2,000 with a maximum of $15,000 per household.\u00a0 It’s paid back over 10 years and loans can be taken out for the next five years or until the $150 million budgeted for the scheme runs out.\u00a0 Loans for households are available to property owners and renters with the owner’s permission.\u00a0<\/p>\r\n
I like the idea of the ACT Sustainable Household Scheme<\/a> because most items covered easily pay for themselves within 10 years, and interest-free loans are an effective way to convince people to make these economically and environmentally sound purchases.<\/p>\r\n But, unfortunately, the scheme comes with some odd conditions and is inefficiently designed.\u00a0 This will result in the benefit it provides being sub-optimal.\u00a0<\/p>\r\n In this article I’ll cover:<\/p>\r\n A pilot version of the ACT Sustainable Household Scheme is running and it’s poised to enter full operation.\u00a0 However, there may be delays because COVID is currently winning.\u00a0 If you apply now it may be fine or they may ask you to try again soon.\u00a0 The ACT says if you enter your details here<\/a> you’ll be sent updates on what’s happening.<\/p>\r\n There are three categories of “approved goods” that you can purchase.<\/p>\r\n Category A<\/strong> covers these three items:<\/p>\r\n If you already have one or more of these, I see nothing in the guidelines<\/a> or terms and conditions<\/a> preventing the zero-interest loans from being used to buy and install new ones.\u00a0<\/p>\r\n If your home is currently being built you can only borrow for Category A items.\u00a0<\/p>\r\n Category B<\/strong> is for items that replace gas or energy inefficient appliances.\u00a0 Proof of removal of old appliances will be required.\u00a0 The three products types it covers are:<\/p>\r\n If you want one of the items above but don’t have an old system to remove, you may have a problem.\u00a0 Hopefully, they will intelligently consider your situation and make exceptions where appropriate.\u00a0 This will prevent people from installing broken down old appliances so they can be “replaced”.<\/p>\r\n Category C <\/strong>is for Electric Vehicles (EVs) and isn’t available yet.\u00a0 At some point, it will be possible to use zero-interest loans to buy or contribute towards buying…<\/p>\r\n The vehicle must emit no emissions when in use.\u00a0 In practice, this means fully electric cars and not plug-in hybrids<\/a>.\u00a0 But technically it allows hydrogen fuel cell cars — which aren’t really available — and rubber band powered cars, which you can purchase from North Korean Motors<\/a>.<\/p>\r\n The total cost of the vehicle must be less than the luxury car tax threshold for fuel-efficient vehicles, which is currently $79,659.\u00a0 This condition seems pointless because we benefit from rich bastards driving electric cars as well as poor bastards.\u00a0 But it can make sense to focus subsidies on EVs affordable to more than a small portion of the population.\u00a0 On the other hand, every additional rule and condition adds to the cost of checking applications and this deadweight loss may eliminate any benefit.<\/p>\r\n New items will be considered over time and may be added to the\u00a0 ACT Sustainable Household Scheme.\u00a0 It gets cold during Canberra winters, so adding insulation seems a no-brainer.\u00a0<\/p>\r\n Up to $15,000 can be borrowed per participant in the Sustainable Household Scheme.\u00a0 This is across the three categories and can be spread out over the five years loans will be available.\u00a0 For example, you could borrow $3,000 to buy a reverse cycle air conditioner this year and next year borrow $10,000 to install a large, high quality, solar system<\/a>2<\/a><\/sup>.<\/p>\r\n The “minimum loan application value” is $2,000.\u00a0 My interpretation of this is the initial loan must be for at least $2,000 and each subsequent loan must also be for a minimum of $2,000.\u00a0<\/p>\r\n If you wanted to borrow more than $15,000 — say you wanted to buy a $45,000 electric car3<\/a><\/sup> — you could borrow up to $15,000 at zero interest through the scheme but would have to pay whatever interest the loan provider normally charges on any amount borrowed above that.<\/p>\r\n The loan is paid back over 10 years.\u00a0 For a $15,000 loan, this will be a monthly payment of $125.\u00a0 You can pay more than the monthly minimum and there’s no penalty for paying early.\u00a0<\/p>\r\n While low-interest rates can contribute to financial market destabilization, unless people start doing something stupid — like investing large sums of money in strings of ones and zeros spat out by computer programs<\/a> — I think we’re good.\u00a0 (Image:\u00a0 Pigwiththefaceofaboy<\/a>)<\/p><\/div>\r\n Exactly who can take out a loan gets a little complicated.\u00a0 Each participant can borrow up to $15,000 but a participant is defined as:<\/p>\r\n Now if you’re thinking — as I would — that you can borrow $15,000 for the home while your husband4<\/a><\/sup> can borrow $15,000 for a car — but that does not appear to be allowed.\u00a0 The guidelines state:<\/p>\r\n “Each participant may borrow a maximum of $15,000 over the life of the Sustainable Household Scheme.\u00a0 <\/span>This is a cumulative maximum across eligible product categories A, B and C.”<\/span><\/p>\r\n<\/blockquote>\r\n This suggests if a household has borrowed $7,000 to get an air conditioner and heat pump hot water system, anyone in that household will only be able to get a zero-interest loan of up to $8,000 for an electric vehicle.\u00a0 Otherwise, the guidelines would probably just say, “Hey, you can borrow another $15,000 interest-free for an EV.”<\/p>\r\n The guidelines do say they recognize there can be multiple people in a household who want to borrow money for an EV and will consider complex arrangements on a case-by-case basis.\u00a0 To me it sounds like they’re making work for themselves.\u00a0 I would have gone for an arrangement that doesn’t require an administrator’s decision.<\/p>\r\n While only available for households at the moment, non-profit organizations will be able to use the scheme in the future.\u00a0<\/p>\r\n A zero-interest loan for household items — categories A & B — has these requirements:<\/p>\r\n I don’t know why they bother having a limit on the Unimproved Value of properties.\u00a0 It will eliminate very few people and everyone benefits if the rich are more energy efficient.\u00a0 We may even benefit more since the rich tend to use the most energy.\u00a0 I can only guess they’re fond of pretty red tape in Canberra.<\/p>\r\n If you are building a new home you can only borrow for Category A items.\u00a0<\/p>\r\n Borrowing for an electric vehicle has the following requirements:<\/p>\r\n I see nothing that says a loan can’t be used for a bicycle or e-bike, since they are vehicles that produce no emissions when in use.\u00a0 If you want a zero-interest loan to get a $2,000+ bicycle, screw you, that’s not what it’s for.\u00a0 You can get a good bicycle for $300.\u00a0 But good quality e-bikes tend to start around the minimum loan value of $2,000.\u00a0 So it may be possible to use a zero-interest loan to get one of them.\u00a0 But don’t blame me if you get knocked back.<\/p>\r\n As with any loan, you must pass a credit check.\u00a0 This is because everyone who loans money prefers that it goes to people likely to pay it back.\u00a0 If you have difficulty making payments they may alter the deal to extend the period of the loan.\u00a0<\/p>\r\n![\"\"](\"https:\/\/www.solarquotes.com.au\/blog\/wp-content\/uploads\/2021\/08\/act_suboptimal.jpg\")
<\/p>\r\n\r\n
What Can I Borrow Money For?<\/h2>\r\n
\r\n
\r\n
\r\n
More Approved Goods In Future<\/h2>\r\n
How Much Can Be Borrowed?<\/h2>\r\n
![\"\"](\"https:\/\/www.solarquotes.com.au\/blog\/wp-content\/uploads\/2021\/08\/act_low_interest.jpg\")
Who Can Borrow?<\/h2>\r\n
\r\n
\r\n
Eligibility For Household Loans — Categories A & B<\/h2>\r\n
\r\n
Eligibility For EV Loans — Category C<\/h2>\r\n
\r\n
There Is A Credit Check<\/h2>\r\n